LML4804
Assignment 1 Semester 2 2025
Unique Number:
Due Date: 8 September 2025
QUESTION 1
1.1 Mr X – Attorney and Trust Account
Mr X is a sole proprietor attorney based in Tshwane who, according to his work policy,
requires payment into his trust account before rendering services. At the end of the 2024/25
year of assessment, his trust account reflected R175 000 for work still to be performed.
Additionally, he had issued invoices to clients who had not made upfront deposits, offering a
discount for early settlement. None of these invoices were settled by year-end.
The question is whether the R175 000 in trust and the invoiced but unpaid amounts form
part of his gross income for 2024/25.
The definition of gross income in section 1 of the Income Tax Act 58 of 1962 includes “the
total amount, in cash or otherwise, received by or accrued to a taxpayer, excluding amounts
of a capital nature.” The test is therefore whether the amounts were received or accrued.
Terms of use
By making use of this document you agree to:
Use this document as a guide for learning, comparison and reference purpose,
Terms of use
Not to duplicate, reproduce and/or misrepresent the contents of this document as your own work,
By making use of this document you agree to:
Use this document
Fully accept the consequences
solely as a guide forshould you plagiarise
learning, reference,or and
misuse this document.
comparison purposes,
Ensure originality of your own work, and fully accept the consequences should you plagiarise or misuse this document.
Comply with all relevant standards, guidelines, regulations, and legislation governing academic and written work.
Disclaimer
Great care has been taken in the preparation of this document; however, the contents are provided "as is" without any express or
implied representations or warranties. The author accepts no responsibility or liability for any actions taken based on the
information contained within this document. This document is intended solely for comparison, research, and reference purposes.
Reproduction, resale, or transmission of any part of this document, in any form or by any means, is strictly prohibited.
Assignment 1 Semester 2 2025
Unique Number:
Due Date: 8 September 2025
QUESTION 1
1.1 Mr X – Attorney and Trust Account
Mr X is a sole proprietor attorney based in Tshwane who, according to his work policy,
requires payment into his trust account before rendering services. At the end of the 2024/25
year of assessment, his trust account reflected R175 000 for work still to be performed.
Additionally, he had issued invoices to clients who had not made upfront deposits, offering a
discount for early settlement. None of these invoices were settled by year-end.
The question is whether the R175 000 in trust and the invoiced but unpaid amounts form
part of his gross income for 2024/25.
The definition of gross income in section 1 of the Income Tax Act 58 of 1962 includes “the
total amount, in cash or otherwise, received by or accrued to a taxpayer, excluding amounts
of a capital nature.” The test is therefore whether the amounts were received or accrued.
Terms of use
By making use of this document you agree to:
Use this document as a guide for learning, comparison and reference purpose,
Terms of use
Not to duplicate, reproduce and/or misrepresent the contents of this document as your own work,
By making use of this document you agree to:
Use this document
Fully accept the consequences
solely as a guide forshould you plagiarise
learning, reference,or and
misuse this document.
comparison purposes,
Ensure originality of your own work, and fully accept the consequences should you plagiarise or misuse this document.
Comply with all relevant standards, guidelines, regulations, and legislation governing academic and written work.
Disclaimer
Great care has been taken in the preparation of this document; however, the contents are provided "as is" without any express or
implied representations or warranties. The author accepts no responsibility or liability for any actions taken based on the
information contained within this document. This document is intended solely for comparison, research, and reference purposes.
Reproduction, resale, or transmission of any part of this document, in any form or by any means, is strictly prohibited.
